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Aramco invests $500m in LNG business MidOcean

Aramco MidOcean MidOcean Energy
The Aramco-MidOcean deal allows the Saudi oil major to tap into the booming demand for LNG
  • MidOcean is a unit of US investor EIG
  • Aramco can increase its stake
  • LNG demand to grow by 25%

Saudi Arabia’s Aramco has made its first investment in the international liquefied natural gas (LNG) market with a $500 million investment in MidOcean Energy.

The Saudi oil supermajor has acquired a minority stake in the company, which is the LNG unit of US-based energy investor EIG.

The deal includes an option to increase the size of its shareholding.

“We anticipate strong demand-led growth for LNG as the world continues on its energy transition, with gas being a vital fuel and feedstock in various industries,” Amin H. Nasser, Aramco CEO, said.

The outlook for LNG is bullish, according to Wood Mackenzie, with another 100 million metric tonnes per annum of capacity required to meet demand growth by the mid-2030s. This is a 25 percent increase on current supply and on top of what’s already sanctioned.

The agreement builds on the relationship between Aramco and EIG, which was part of a consortium that acquired a 49 percent stake in Aramco Oil Pipelines Company, a subsidiary of the Saudi oil major, in 2021.

Completion of the Aramco-MidOcean deal is subject to closing conditions, which include regulatory approvals.

Global LNG trade grew by almost 7 percent last year, reaching a new record of 401.5 million tonnes, according to a report from the International Gas Union.

European buyers have covered the void left by cuts to Russian pipe gas.

MidOcean is also in the process of acquiring interests in four Australian LNG projects, with a growth strategy to create a diversified global business for the liquid fuel, the companies said.

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